How contract analytics can benefit asset managers

May 9, 2023

An immense volume of data is hidden away in corporate contracts, and until recently, very few businesses were able to access their contract data efficiently. Gathering information from contracts required lengthy, manual reviews and tracking data in spreadsheets.

With the growth of document processing, businesses have been able to digitize their agreements and turn contract provisions into structured data. Now investment firms can categorize, analyze, and report on contract data via a contract management solution.

To learn more about applying contract analytics to private fund documents, including non-disclosure agreements and side letters, request a demo of Ontra’s legal operating system.

What is contract analytics?

Contract analytics or contract analysis is the systemic review of data contained in some or all of a business’s legal agreements to uncover actionable insights.

What are the benefits of contract analytics?

Ongoing contract analysis offers investment firms improved visibility into:

  • Contract terms
  • Ongoing contractual obligations
  • On- and off-market terms
  • Trends in contract terms over time
  • Contract cycle times

A better understanding of a firm’s agreements, even routine NDAs, can empower firms to improve their contract management processes. When firms have the ability to quickly and easily compare contract language, they can identify unnecessary inconsistencies. Firms can then move toward more consistent contract language, enabling them to standardize some contract compliance efforts and mitigate risk.

Additionally, gaining a better view of market terms helps firms adjust their negotiation stances in the future. By understanding what firms routinely agree to, they can update their preferred and fallback positions in their contract playbooks.

Ultimately, by adopting more consistent language and market terms, firms have the ability to lower their contract turnaround times, and with faster NDAs comes swifter dealmaking.

Which contract data can firms track?

Examples of data investment firms can track include:

  • Contract volumes
  • Parties to agreements
  • Contract turnaround times
  • Contract effective dates
  • Contract durations
  • Specific deal information
  • Governing law
  • Duration of particular provisions
  • Legal definitions
  • Notice requirements
  • Reporting requirements


Is contract analysis part of contract lifecycle management?

Investment firms can incorporate contract analytics into their contract lifecycle management processes. They can then use contract data to understand trends, revise contract playbooks, take a stronger position in negotiations, and more proactively manage contract compliance.

What is contract analytics software & do firms need it?

Contract analysis is typically a feature within a contract management solution. The software relies on natural language processing and artificial intelligence to scan, understand, and categorize contract language. Firms then view their contract data through the solution’s reporting capabilities.

Firms benefit from implementing a software solution that includes a central contract database and contract analysis features. Many investment firms choose a solution involving contract AI, such as Contract Automation by Ontra, which is purpose-built for the private markets.

Automated contract analysis

Contract Automation by Ontra is a human-in-the-loop solution that doesn’t rely solely on machine learning and AI. Instead, the independent lawyers in our global Legal Network are an integral part of the solution, ensuring our customers receive accurate contract data.

Ontra automates the document processing experience while a legal network member negotiates an agreement on a customer’s behalf. Once the customer finalizes and executes an NDA or another routine contract, the new data is uploaded to the contract repository and available in the reporting feature. Our AI-enabled software makes the lawyers in our legal network hyper-efficient.

Asset managers and investment banks can use this automated contract analysis system to keep track of the volume of their contracts, key terms, and much more. With this information, they can make decisions on how to negotiate similar agreements in the future and how best to meet their commitments.

Risks of manual contract analysis

Inefficient use of resources

When firms lack automated contract management analytics, they have to pull in-house lawyers, business professionals, and even outside counsel off other work to perform manual analysis. These professionals may need to review dozens of paper contracts, and create, fill in, and update spreadsheets. They might take hours to do something Ontra’s Contract Automation solution can do in minutes.

Lack of visibility into contracts

Many firms lack accurate visibility into their agreements. This issue complicates their contract compliance efforts significantly, and often forces firms into a reactive position rather than benefiting from proactive obligation management.

Inconsistent language

Firms have a much harder time tracking contract terms and specific language in spreadsheets. It can feel impossible to compare language across dozens or hundreds of contracts or to analyze the most common terms in a routine agreement. Given the difficulties of manual review, inconsistent terms and language tend to persist.

Off-market terms

A lack of visibility into their contract terms and specific language makes it more likely firms will have off-market provisions. Without accurate contract data, firms will likely delay updating their contract playbooks appropriately, which in turn, leads the firm’s lawyers and business professionals to continue to negotiate off-market terms.

Inability to make data-driven decisions

When firms lack contract data, they base many decisions on anecdotal information. Lawyers and business professionals might negotiate agreements based on what they believe to be best without understanding what the firm has agreed to in previous contracts. For example, despite the firm having a preferred negotiation stance, the contract data might uncover the firm more often agrees to its fallback stance, which could support updating the contract playbook.

AI-driven contract analysis with Ontra

Asset managers and investment banks looking for greater transparency into their NDAs and other routine agreements would benefit from Contract Automation. Our AI-driven solution provides firms with a more efficient way to negotiate, execute, manage, and analyze their agreements.

See how Contract Automation can lighten a lawyer’s workload

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